Employer Reporting Requirements - IRS 6055 & 6056

On September 9, 2013, the IRS released proposed regulations on the Affordable Care Act (ACA)'s annual information reporting requirements under Internal Revenue Code (IRC) sections 6055 and 6056.  Employers and medical benefits providers have been eagerly awaiting these new proposed regulations.

Who is responsible for the reporting?  

IRC section 6056:  Large employers (as defined by the Employer Shared Responsibility Provisions) with both fully-insured and self-insured plans are subject to the reporting.  This means that employers subject to the 2015 penalties must comply with this reporting requirement. 

IRC section 6055:  Employers who sponsor self-insured health plans

How does an employer report the information?

IRC section 6056:  Forms 1094-C and 1095-C (or a substitute form if certain requirements are met)

IRC section 6055:  Form 1095-B (or a substitute form if certain requirements are met)

When will reporting begin?

IRC sections 6065 & 6055:  February 28, 2016 (or March 31, 2016 if filed electronically). The report must cover information for the 2015 calendar year.  Employers must continue to report annually. 

The IRS encourages employers to voluntarily comply with the information reporting provisions in 2014 in order to test reporting systems and plan designs prior to full implementation in 2015.

What information must be reported to the IRS? 

IRC section 6056:  For each person enrolled in coverage, the employer must report to the IRS the following:

• Name, address and Employer Identification Number of the employer;
• Certification as to whether the employer offers its full-time employees and their dependents the opportunity to enroll in minimum essential coverage under an eligible employer sponsored plan;
• The number of full-time employees for each month during the calendar year;
• For each full-time employee, the months during the calendar year for which coverage under the plan was available;
• For each full-time employee, the employee's share of the lowest cost monthly premium (self-only) for coverage, providing minimum value offered to that full-time employee under an eligible employer-sponsored plan.  This information must be provided for each calendar month;
• Name, address, and Taxpayer Identification Number of each full-time employee during the calendar year and the months, if any, during which that employee was covered under an eligible employer-sponsored plan; and
• Any other such information as the IRS may require.

IRC section 6055:  For each person enrolled in coverage, employers sponsoring self-insured plans must report to the IRS the following:

• Name of each individual enrolled;
• Name and address of the primary insured or responsible individual who submits the application for coverage (such as a parent or spouse);
• Taxpayer Identification Number for each covered individual;
• Months of coverage for each covered individual;
• Any other information specified by the forms instruction and published guidance provided for by sections 601.601(d) and 601.602;
• Name, address and Employer Identification Number of the employer maintaining the plan; and
• Whether coverage was enrolled through the Small Business Health Insurance Options Program (or "SHOP").

What must employers provide to covered individuals?

IRC sections 6056 & 6055:  Employers must provide written notice to covered individuals of the following:

• Name, address and contact number of the reporting entity; and
• The information (listed above) required to be reported to the IRS concerning the covered individual (pursuant to either IRC section 6055 or 6056 as applicable).

Other information that employers may need to report:

The proposed regulations state that simplified reporting methods are under consideration, and the IRS may request additional information from employers, including:

• Information as to whether the coverage offered meets minimum value,
• Total number of employees by calendar month,
• Whether coverage was affected by a waiting period, and
• Whether an employer was not conducting business during any particular month or does not expect to be an "applicable large employer" the following year.

Where can employers obtain more information?  The proposed regulations are available at https://www.federalregister.gov/articles/2013/09/09/2013-21783/information-reporting-of-minimum-essential-coverage and https://www.federalregister.gov/articles/2013/09/09/2013-21791/information-reporting-by-applicable-large-employers-on-health-insurance-coverage-offered-under.